N.J. Supreme Court Opines on Prior Public Use Doctrine in Railroad Case

by: Joseph Grather
8 Aug 2013

On August 6, 2013, the New Jersey Supreme Court issued its opinion in Norfolk Southern Railway Co. v. Intermodal Properties (available here).  The Court’s opinion was limited to analysis of two narrow issues; 1) whether the proposed use is incompatible with the public interest; and 2) whether the term “exigencies of business” limited the railroad company’s power of eminent domain to takings necessitated only by emergent matters.

The answer to the first question required an analysis of the “prior public use doctrine” because Intermodal argued that even though its property was being used as a warehousing facility at the time of the taking it could be used as a public parking facility.  The Court turned to the narrow question of whether a “property owner can defeat a railroad’s exercise of eminent domain by introducing proofs that the owner’s proposed use of its property would better serve the public interest than would the railroad’s proposed use thereof.” (Slip op. at 25).

The ultimate answer was no, simply because Intermodal does not have the power of eminent domain.   (The rationale behind the “prior public use doctrine” is to prevent an “endless round of condemnation and re-condemnation” between two entities with the power of eminent domain).

The second question of statutory interpretation was also answered in favor of the railroad.  The Court provided a thorough analysis of the term and researched its meaning as of the date of adoption of the statutes at issue in the mid-to-late 19th century to conclude that it was “understood to describe generally the needs of business, or the ordinary course of business, rather than to allude to an emergent, urgent, immediate, or pressing need.”

Thus, the Court affirmed the Appellate Division’s decision upholding the taking of Intermodal’s private property for railroad use.

More on this case is available on our the Inverse Condemnation blog authored by our Owners’ Counsel colleague, Robert Thomas.

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